The Florida Documentary Stamp Tax is imposed on documents transferring an interest in real estate, but in many cases, people are unaware of this tax and how it may apply to their real estate transaction, and they’re surprised with an unwelcome extra expense when it comes time to record the property deed. Interest and penalties for not paying this tax are steep, so it’s critical to understand and plan for documentary stamps.

When Does The Documentary Stamp Tax Apply?

The document stamps are actually an excise tax on the documentation that transfer interest in real property and written obligations to pay. Therefore you’re paying tax on the property deed, the mortgage, or some other kind of promissory note. Documentary stamps are typically paid at the time the document is recorded. But unrecorded documents may also be subject to the tax, unless the transaction or party is exempt.

For transactions that don’t involve financing, the Document Stamp Tax for recording the property deed in most counties is 70 cents per $100 of the sales price (known as consideration). This includes quit claim deeds between spouses and family members.

For financed transactions, the documentary stamp tax is 35 cents per $100 of face value on the note; the tax is based on the amount financed, not the selling price. There is an additional “Intangible Tax” of 20 cents per $100 financed, which has to be paid before the mortgage is recorded.

When a property owner wants to transfer ownership from their personal assets to a Limited Liability Corporation they own;

When property is transferred between spouses and there is no mortgage;

In certain cases of property being transferred into a trust;

Or between ex-spouses for up to a year after their divorce becomes final.

Need Help With Documentary Stamp Tax?

The real estate attorneys at Overstreet, Miles, Cumbie, and Finkenbinder are highly experienced in dealing with the intricacies of the Florida Documentary Stamp Tax laws. Give us a call or contact us online, and we’ll schedule a consultation appointment and let you know how we can help!

When you are involved in a residential or commercial real estate transaction in Florida, it’s important to understand what a real estate attorney can to do to actively protect your interests, prevent mistakes, and solve issues that could delay your closing. Working with a real estate attorney helps you stay on top of all the details of your life-changing investment and makes your transaction as painless as possible.

Find & Resolve “Hidden” Issues

When you purchase real estate, a title agent will search the property title for things like liens, and verify that the seller is the rightful owner, entitled to sell you the property. The results of this search are provided to the parties in a title commitment, which is one of the most important documents in the closing process. The vast majority of buyers do not know what a title commitment is and therefore don’t bother to review it. Hiring a real estate attorney to review the title commitment can alert you to issues before you purchase the property. In many cases they can help resolve these issues before the closing. Otherwise, you may not be aware of title issues that could cost you money later on: Issues like liens, easements, or deed restrictions. A real estate attorney can serve as the title agent too.

Gain A Clear, Accurate Understanding

Real estate contracts are incredibly complicated, and it’s critical that you understand everything you’re committing to, both rights and obligations, before you sign. When you hire a real estate attorney to review the documentation and contract for your potential purchase, you add a layer of protection and peace of mind. Your real estate attorney will review all the terms and contingencies, explain anything you don’t understand, and advise you if they find issues that work against your best interest. Another benefit to having an attorney review the title and contract is that they can let you know if there are any land use controls or zoning issues that could affect your future plans for the property.

Added Protection For Short Sales & Foreclosures

Short sales and foreclosures can offer buyers excellent value, but that value is not without risk. When you’re dealing with bank-owned property or property that the lender has agreed to allow to be sold for less than the seller owes, there are some potential pitfalls. Hiring a real estate attorney helps ensure that you’re not stuck in a situation where the seller doesn’t actually have the lender’s permission for a short sale, or the lender is able to come after you for the shortfall later, or you’re dealing with liens or other encumbrances that transfer with the property title.

Experienced Real Estate Attorneys In Florida

The real estate attorneys at Overstreet, Miles, Cumbie & Finkenbinder are highly experienced in helping Florida real estate buyers and sellers protect their interests and investments. Call us or contact us online for a confidential consultation, and we’ll let you know what to expect and how we can help!

Sometimes it becomes necessary to remove a person’s name from a property deed. This often happens in cases of divorce or death. Although it might seem like removing someone from a deed would be a simple process, it’s actually a complicated matter that is best left to a real estate law attorney.

Deeds of Conveyance

A deed establishes the legal owners of a property. Whoever is named on the deed is considered the owner of the property. In order to change legal ownership of a property, it must be transferred, or conveyed, by the owner to another person through a deed of conveyance.

There are two types of deeds of conveyance: quitclaim deeds and warranty deeds, but which one is better suited for the transaction depends on how the property is held and the purpose of the change in ownership.

Both quitclaim deeds and warranty deeds indicate that the seller/grantor has ownership of the property and a right to transfer their ownership to the buyer/grantee, but they do not provide similar levels of assurance. Quitclaim deeds provide no assurance that there isn’t another person who may also have claim to the property. This makes them a riskier choice in most situations.

Warranty deeds, on the other hand, do provide explicit assurance to the buyer/grantee that there aren’t any other people with claim to the property. That’s why warranty deeds are the most commonly used deed in typical real estate transactions.

Ownership Type Affects Deed Choice

Property can be owned by multiple parties or title may be held in different ways that affect the ownership rights. The type of property ownership determines how the property may be transferred via deed. Types of property ownership include:

Sole Ownership. One person owns the property.

Joint Tenancy. More than one person owns the property.

Rights of Survivorship. More than one person owns the property and each is entitled to inherit an equal share upon another owner’s death.

Tenants in Common. More than one person owns the property but none of them inherit any shares upon the death of another owner.

Tenancy by entirety. Two people own the property. They inherit each other’s shares upon the other person’s death.

Best Deed Choice Per Property Type

In general, warranty deeds are better in situations with multiple owners, in transactions between strangers, when money changes hands, and in any situation where the buyer wants assurance that the property is free from the ownership interests of other parties.

Quitclaim deeds are a better choice when property is being transferred between family members and no money changes hands. A good is example is siblings inheriting their parent’s property. A quitclaim deed can be used to establish the children as the new owners of the property by removing the deceased parents’ names from the deed. See our blog on additional consideration when using quitclaim deeds

Removing Names From Deeds Is Best Accomplished With Legal Assistance

There are several requirements that must be followed in order to legally remove someone’s name from a deed. Deeds are only valid if they are properly executed and delivered. In Florida, they should also be recorded with the local county clerk’s office.

Both types of deeds must name the grantor and grantee, include the date of transfer, the reason for the transfer, a legal description of the property, and the form of ownership, to name just a few of the requirements. They must also be signed in front of a notary public.

As you can see, transferring property is a complicated process in Florida and a misstep at any point in the transaction can invalidate the deed and impact the legal ownership of the property. In some cases, do-it-yourselfers have found themselves in trouble later on because there was a simple error on the deed.

A real estate attorney can ensure all processes are followed correctly and the new deed is valid, establishing proper legal ownership. Contact a real estate attorney at Kissimmee’s Overstreet, Miles, Cumbie & Finkenbinder, P.A. for advice on removing someone’s name from a deed or any of your other real estate law questions.

Deciding to buy a home is the largest investment most people make in their lifetime. Unfortunately, many homebuyers do not understand the terms of the paperwork they sign in the process. If homebuyers aren’t savvy, they can end up among those facing legal disputes over home purchases. Here are 3 ways to protect yourself from common pitfalls:

Don’t Take Your Purchase Offer Lightly.

When you submit an offer on a home, you are agreeing to enter into a legally binding contract (if the seller accepts). While there may be contingencies that allow you to terminate the contract, once signed, it can be difficult and expensive to get out of.

A real estate agent can help you fill out a standard offer contract. It is wise to also have a qualified real estate attorney review the offer before it is submitted. A real estate attorney can advise you on your legal rights and obligations under the purchase offer and help you change the terms to best protect you.

Take Advantage Of The Inspection Period.

This is one of the most important steps in the transaction. The Inspection period begins as soon as the seller accepts your offer, allowing you a set number of days to complete the inspection and determine whether you will move forward with the home purchase. While a seller must legally disclose any “known defects” to a buyer, in Florida it is the homebuyer’s responsibility to have the home inspected to discover any issues that may be present in the home.

Hire a qualified home inspector. A home inspection may reveal defects that change your decision to purchase the home and save you from costly repairs.

Don’t Forego Title Insurance.

As part of the real estate transaction, a title agent or real estate attorney will complete a title search to review the “title” to the property that is being purchased. They will ensure that the property is free from encumbrances, liens and defects. The title agent or real estate attorney will then issue a title insurance policy insuring that it will compensate the insured if a defect, lien or encumbrance is uncovered later. Common title issues include unknown liens, deed fraud and boundary disputes. Don’t leave your property at risk, purchase title insurance.

Title insurance is a specialized insurance policy that protects buyers and lenders against claims that may arise over the title of a piece of property. The policy is a one-time purchase that remains in effect for the duration of ownership, so if, for example, your children inherit your home, the title insurance coverage would continue to insure the property.

Why Would There Be Claims Against The Title Of My Property?

When you purchase real estate, part of the process is detailed research into the public records pertaining to that property. That search should reveal any type of encumbrance on the property including:

Tax or contractor’s liens

Claims of ownership by heirs

Ex-spouses

Creditors of previous owners

Easements that restrict your ability to build on a portion of the property

In certain cases, these encumbrances may not be discovered through the research process at the time of purchase, and those surprises called hidden risks, are precisely what title insurance protects against. Your owner’s title insurance policy obligates the title company who issued it to defend your title at their cost and to compensate you for any lost value of the property that arises from such a claim.

Am I Required To Have Title Insurance?

While there is no real estate law requiring you to carry title insurance, most mortgage lenders will require that the property be covered by both a lender’s title insurance policy, and an owner’s policy may be offered by the seller as part of your real estate contract. If you’re purchasing real estate with cash, you are not required to buy title insurance, its sound business practice to protect yourself and your investment by buying a policy or requesting the seller pay the cost of the policy.

Who Pays For The Title Insurance Policies?

Ultimately, the party responsible for buying the title insurance policy is determined by the sales contract. There are different customs that vary by county, for example, in Sarasota, Collier, Broward, and Miami-Dade counties, the seller typically pays for the title search, while the buyer pays for the owner’s policy, while in Palm Beach County, the seller usually pays for both.

Property deeds are used to transfer ownership from one party to another. There are two basic types of property deeds in Florida: a Warranty Deed and a Quit Claim Deed. The two offer different levels of protection for the new owner with the Warranty Deed providing better protection, but many people opt to use the Quit Claim Deed to transfer property, particularly if the transfer occurs between family members.

Even with a familial connection, quit claim deeds raise many concerns and, when not executed properly, can lead to serious repercussions over the short- and long-term.

Cautions Regarding Quit Claim Deeds

Quit claim deeds do not require the property to undergo a title review or attorney review, which means there is no third-party verification that the title is free and clear of liens or that the one transferring the property title has the right to do so or if there will be tax implications for either party.

Failing to have a real estate attorney review the entire transfer process can have many different consequences for both the grantee and the grantor, such as:

Documentary Stamp Taxes. Any Florida property that has a mortgage on it is subject to tax when ownership is transferred, even if the transfer occurs between spouses.

Capital Gains Taxes. The transfer of property subject to a mortgage is also subject to Capital Gains Taxes per IRS rules. In some cases, a gift of real property can also be subject to Capital Gains.

Florida’s Homestead Tax Exemption. It is possible to lose this exemption when ownership changes, depending on who claims it, when they claim it, and who qualifies to take the exemption.

Florida’s Save Our Home Cap: Amendment 10. This amendment affects the state Homestead Tax Exemption. The Cap can be lost in certain circumstances, even if the Homestead Tax Exemption is retained.

Gift and Estate Taxes. It is possible that a transfer of deed could be interpreted as a gift and be subject to gift taxes and might affect an owner’s estate taxes.

Generation-Skipping Transfer Tax. This tax might be required if the grantee is two or more generations younger than the grantor.

Non-Citizens. Gifts, transfers, and property sales to non-citizens are subject to their own gift, estate, and capital gains tax implications.

Probate. In order to avoid Florida probate the property must be transferred in a certain way. If it is not transferred properly, or if there are any problems with the deed itself, the property will have to go through probate.

Challenges. If a property transfer has the effect of disinheriting someone or placing undue hardship on the owner’s spouse or dependents, it can be challenged in court. In some cases, constitutional restrictions on the deed can create a title defect.

These are just a few of the possible complications that can arise during a property transfer, even if the transfer is amicable, within a family, and no money changes hands. Although they appear to be a simple solution to a simple property transfer, quit claim deeds can be anything but simple, creating problems where there were none prior.

It is always advisable to consult a real estate attorney or estate planning attorney when real property conveyance is required. These professionals will be able to examine not only the legality of transferring the property, but can provide insights as to how the transfer might affect your tax situation and other aspects of your life.

If you would like to use your property for something that is not allowed under the property’s current zoning district, you can request a variance, conditional use permit or to have the property rezoned to one with different restrictions and allowable uses. In this blog we will talk specifically about rezoning.

When To Consider Rezoning

Rezoning is a legislative action that is governed by the counties in Florida, so all rezoning requests must go through the county, or municipality, in which the property is located.

Zoning laws are in place to regulate land uses to serve the health, safety, and general welfare of the public. Rezoning may be allowed if:

The request is consistent with the county, or municipality’s long-range land use plan for the area;

There was an error or oversight during the original zoning of the property; or

Changes have occurred within the geographic area around the property which prevent use of the property under its’ current zoning.

The Rezoning Process

The particulars may vary depending on the county or municipality, but in general the process involves:

Application and fee submission to the county or municipality’s Zoning Office/Department.​

Zoning staff review of the application and submission of a written proposal to the county board of commissioners or zoning board.

A public notice is posted and a public hearing is held. Applicant may be required to present their request and answer questions about it. The public may comment on the request.

Recommendation is forwarded to Board of County Commissioners.

The Board of County Commissioners​ renders a decision.

Consult A Real Estate Attorney For Help With A Zoning Request

Rezoning requests require property owners to do their research. You’ll need to submit an application, pay a fee, make a presentation, and possibly defend your request at a public hearing. There is a lot of paperwork involved and procedures to follow. Many property owners seek the counsel of a real estate attorney to help them navigate the process and ensure their best chance of being granted the zoning change. In some cases, the real estate attorney may advise you to seek a variance or conditional use permit, which are easier to obtain than a zoning change and still accommodate your desired use of the property.

The real estate attorneys at Kissimmee’s Overstreet, Miles, Cumbie & Finkenbinder, P.A have experience with rezoning in Osceola County and can help guide you through the process.

Contact us at 407.847.5151 to discuss your situation and learn more about our zoning services.

When you think about homestead exemption, most people immediately think of the $25,000 property tax exemption. That’s because many people are unaware of a valuable form of asset protection granted under Florida’s Constitutional homestead exemption. The Florida Constitution, Article X, Section 4, exempts homestead property “from forced sale under process of any court”. This means the proper homestead designation can also keep your property out of hands of creditors.

What qualifies for homestead exemption?

The designation of homestead is granted to a person’s primary residence, including condominiums, townhomes, and mobile homes. If the property is located within a municipality (i.e. within city limits) up to one-half acre, plus the improvement, shall be exempt homestead. If the property is located outside of a municipality then up to 160 acres of land, along with the improvements, shall be exempt homestead.

How does homestead exemption work?

If a large (court) judgment is entered against you, it can attach to property that you own in the county, and the creditor can force that property to be sold in order to satisfy the judgment. Fortunately creditors cannot force sell your homestead property. You may be wondering how the creditor or the Court determine whether your property is homestead? You can sign an affidavit stating that property is your homestead property,2 which is recorded with the Clerk of the Courts. However, there is no formal requirement that this affidavit be filed.

Is this different than homestead property tax exemption?

With homestead property tax exemption, an application has to be filed with the Osceola County Property Appraiser’s Office. All Florida residents are eligible to apply for a $25,000 homestead property tax exemption if they have legal or equitable title to the property and maintain it as their primary residence beginning on January 1st of the application year.3 Constitutional homestead exemption was created to prevent people from losing the homes they live in to creditors and allows homestead property to be transferred to your spouse and/or children free from creditor claims upon your death. If you have questions about Florida homestead exemption, an experienced attorney can help you protect your assets.

1See Article X, Section 4, of the Florida Constitution.

2See Florida Statute § 222.01 and 222.02

3Visit the Osceola County Property Appraiser’s website https://ira.property-appraiser.org/homestead/WebForm1.aspx for more information.

Unlike many other states, Florida does not require the use of an attorney during a real estate transaction. Buyers and sellers have the choice of using an attorney or a title company to handle the closing on their real estate transaction. This often causes the parties to wonder why they should hire an attorney instead of a title company to handle their closing.

1. A title company works for the title insurer, not the buyer or the seller, whereas real estate attorneys work for whomever hires them. Once hired, an attorney represents that client throughout the transaction – in addition to overseeing the transaction to completion, they look out for their clients’ best interest and advocate for their client. The title company’s role is to prepare the basic closing documents required by the title insurer to complete the transaction and issue the title insurance policy.

2. Title agents do not have law degrees and cannot provide legal advice. When there are problems or questions, the buyer/seller can’t turn to the title company for help or advice. One of the most common issues that comes up is how to take title to the property, which has legal and tax ramifications. A title agent cannot provide advice in this situation, but an attorney can. Realtors as well as the buyer/seller, benefit from working with attorneys since the attorney can review the contract and answer legal questions during the contract negotiation process; title companies cannot.

3. Title agents cannot create contract addenda, address problems in the sales contract, deal with non-standard forms, or correct legal issues that affect the title. This is important because if an issue arises, corrective documents may need to be obtained or created. Attorneys can provide legal advice on the best way to handle the issue, as well as prepare necessary documents, title agents cannot. Depending on the issue, a title agent will in fact have to send parties out to hire an attorney (at their own expense) to handle specific problems. Not having an attorney can delay the closing or even cause the transaction to fall apart entirely.

4. The costs of hiring a title company vs. an attorney are comparable. Many closing costs such as title insurance premiums, documentary stamps, and recording costs are set by the State of Florida. They are the same whether an attorney or a title agent is facilitating the process. In some cases, using an attorney can actually save the parties money by performing double duty as an attorney and a title agent; a title agent cannot do the same.

To learn more about the real estate services at Overstreet, Miles, Cumbie & Finkenbinder, P.A, contact us at 407.847.5151.

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Since its founding, our firm has focused on serving the needs of the local community offering a full range of legal services with particular focus on probate, estate planning, real estate, commercial litigation, and immigration. Our partners have over 150 years of combined experience.